Category Archives: central bank sugar bombs
And a few hours later we get a NY Fed spokesman indicating Williams did not mean to suggest a large rate cut was coming later this month. What the hell is going on? Market economy. Sure it is.
On Tuesday evening I was tempted to do a blog post with the same message I’ve delivered many times over the past decade or so: we are/were within 1 week and 1% of the initiation of another protracted series of stock market drops. True to form, within 48 hours a central banker blinked and dropped another sugar bomb. (don’t take my word for it […] Read the rest of this entry
Hello Fed, ECB, BoJ, PBoC, SNB. At least one of you must threaten to spike the punch bowl this week. Otherwise reality will start to happen again.
On Monday this week I did a blog post wherein I wondered which central bank would spike the punch bowl this week to keep the party going / stop it from ending. I did this because the Greedometers suggested stock market pain was once again on our doorstep. On Tuesday morning my question was answered when the PBoC dropped bank reserve ratios in a […] Read the rest of this entry
This is a huge week for earnings with approximately 200 S&P500 companies reporting. However, earnings have not mattered to S&P500 company / index prices in many years. You are probably aware that as of late January 2018, with the S&P500 setting new all time highs near 2900 we have these metrics: Top 4 most expensive S&P500 points in time as measured by Price to […] Read the rest of this entry
BOJ Governor Kuroda hit the wires last night by hinting the BoJ may begin maybe possibly thinking about the potential to maybe begin reducing (tapering) its mammoth QE program in 2019. Mammoth is too gentle a term for the BoJ’s QE program. Epic works better. With newly printed QE-yen, the BoJ has been buying every newly issued JGB (Japan federal government bond), and with […] Read the rest of this entry
The new Fed Chairman Powell gave Congressional testimony this week about the economy, inflation, and interest rates. In summary (to paraphrase): the economy is doing well and going to continue to do so inflation is on track to reaching our 2% target unless something bad happens, we’ll likely raise interest rates 25bps four times this year. NY Fed Prez Bill Dudley chimed in a […] Read the rest of this entry
Boston Fed Prez Rosengren did a scheduled speech this afternoon. A link to the high points… https://www.bostonfed.org/news-and-events/news/top-takeaways-bard-college-talk-041917.aspx Notables: in the future, the weak economy “may necessitate more frequent use of large-scale asset purchases during recessions.” “quite likely” we’ll see more central bank QE programs in the future Fed “would take a very gradual approach to balance sheet reduction.” No obvious risk-on response from asset markets. Hmmm. […] Read the rest of this entry
A series of Fed leaders spoke this week. They all indicated we’d see a rate hike in 2 weeks time (next FOMC meeting March 14-15). This culminates with Fed chair Yellen today (then it’s 1.5 weeks of blackout). In my years of following the Fed, NY Fed Prez Dudley has been the most powerful/effective speaker -aside from the Fed chair- in that his comments […] Read the rest of this entry